How your marital property is divided at divorce will affect your financial future for years to come. If you or your spouse owns a business in Texas, then the division of community property may be particularly complex. Following are three things to do if your divorce involves a business.
1. Obtain an accurate and comprehensive valuation.
Not fully accounting for the health of your business and its ability to provide future income can have a detrimental impact on your divorce settlement. The valuation of a business should account not only for tangible assets and debts, but also for the intangible value of the business' reputation and brand.
What you don't want is an inaccurate or short-sighted appraisal. This could prove costly for both parties, especially if you find yourself in a property-related dispute that requires resolution in court.
2. Consider the tax liability.
Often the tax implications are not immediately clear when dividing business assets and liabilities between divorcing spouses.
For example, if the business made money this year but lost money in a previous year, then the business owner can apply the previous loss to the current tax bill. This is called a tax loss carryforward, and it effectively reduces taxable income and the overall tax liability.
Whether you're a business owner or the spouse of a business owner, it is important to be aware of how a tax loss carryforward or other tax matter -- deferred taxes, for instance -- will affect your share of the divorce settlement.
3. Hire a divorce and family law attorney with experience in analyzing company finances.
If your divorce involves company assets and debts, then you need someone on your side with the resources -- tax accountants and business valuation specialists -- to appraise the entirety of the business. Not every divorce attorney has these resources.
At Daniel R. Bacalis, P.C., we have a great deal of experience in valuing business assets and liabilities. We handle divorce and family law matters in Hurst, Fort Worth and League City, Texas.
To learn more, please visit our overview of complex property issues.